Belgian funds post third lowest returns on record

BELGIUM – Belgian pension funds returned an average of –0.07% for 2000, according to the final results of the Belgian Association of Pension Funds' annual performance analysis, the third lowest figure since the statistics were started.

Figures still hold up strongly over the long term, however, with three-year average returns at 10.52% and over five years at 12.68%. As a result, contribution levels from employers and employees were down in Belgium for the second year running, dropping16% on the year from e464.9m to e417m, a reflection of the favourable returns over the last few years.

Category A funds (small) with less than e25m in assets were the best performers last year with an average return just above zero at 0.21%. Category B funds (medium) with between e25 and e125m took the biggest hit averaging –0.64%, while category C funds (large) with more than e125m returned 0.07%. Over the long term, however, the larger funds are still the top performers, the association notes.

The figures also show that Belgian funds are still investing large portions of their assets in Sicavs, with 65% of investments last year going the pooled fund route. This in part reflects the possibility of diversification offered to small pension funds, but also the fiscal imperative whereby pension funds are still the only institutions obliged to pay a tax (precompte mobilier) on direct investments.

The survey this year received responses from a total of 135 funds, representing BEF397.3bn (e9.8bn).